S&P 500 Data only

[Guest CocolinoFan]

I was looking to buy into the S&P 500 index. But when I search "S&P500" in the IG platfrom I get the "US500" index. Comparing the prices I conclude that the US500 and the S&P500 are the same index. But why did IG change the name of the index? And lastly I am unable to buy or sale in this index. I get a red cross saying "data only". Please help

[Caseynotes]

Hi @CocolinoFan,  when you say S&P 500 you could be meaning any of dozens of different indexes. 

For the 'data only' notice is that on a leveraged spread bet or cfd account? 

[Caseynotes]

@CocolinoFan, no problem, glad to help. It's a short read with 3 suggestions and specifically refers to Buffet and his own recommendations. Buy an ETF, buy an Option or buy company stocks.

[Guest CocolinoFan]

Good day @Caseynotes 

8 minutes ago, Caseynotes said:

when you say S&P 500 you could be meaning any of dozens of different indexes. 

I mean the original S&P500;  the index of 500 largest companies having common stock listed on the NYSE, NASDAQ, or the Cboe BZX Exchange. THE S&P500. I don't really understand why there is any confusion, it is arguably the most famous index in the world.

8 minutes ago, Caseynotes said:

For the 'data only' notice is that on a leveraged spread bet or cfd account? 

I'm not sure man. I just a normal account where you buy and sell actual shares. No leverage or anything.

[Caseynotes]

Hi @CocolinoFan, ok, the indices themselves are only available on leveraged accounts as they are a derivative and you are speculating on direction of movement and taking a position size rather than buying or selling an actual share. They are on the non-leveraged platform for reference only that's why you are getting the 'data only' notice.

To trade them you will need to open a spread betting (UK only) or a contract for difference (cfd) account.

[Guest CocolinoFan]

@CaseynotesBut why is that? The US500 clearly has a price right? So are you able to buy "shares" in the index, but with the IG platform you can't do that and you are only able to speculate the direction of movement?

And one last thing: What do you mean " as they are a derivative" derivatives of what, the real S&P? 

[Caseynotes]

@CocolinoFan, yes it has a price but not a share so you can buy 'at' a price but you are not buying a 'share'. The S&P itself isn't real, it's just an indicator of the perceived value of the companies listed on it. 

Watch the short video on this page (you will need to be logged into IG).

https://www.ig.com/uk/indices

[Guest CocolinoFan]

@CaseynotesBut Warren Buffett famous says that you should invest in the S&P500 as an average individual. So he is not refereeing to "buying" into the index; but he is saying you should "bet" that the index will increase in value using a leverage account?

[Caseynotes]

@CocolinoFan, The big US indices have performed well over the long term, see the last 100 years of the Dow in the chart below for example.

There are many ways you could invest rather than speculate on a index, the most common would be via an index linked mutual fund or an exchange traded fund. In fact I think S&P ETFs are the most popular ETFs in existence.

[Guest CocolinoFan]

@CaseynotesI understand there are many ways to invest. But this is not what I asked:

49 minutes ago, CocolinoFan said:

@CaseynotesBut Warren Buffett famous says that you should invest in the S&P500 as an average individual. So he is not refereeing to "buying" into the index; but he is saying you should "bet" that the index will increase in value using a leverage account?

I want to buy indexes not ETFs. So you are normally able to buy into an index but IG dose not let you do that with the S&P it just lets you speculate. Is this true or not?

[Caseynotes]

@CocolinoFan no you can't buy the S&P 500 and take delivery of the underlying. You can only buy the shares of  companies in the S&P on a leveraged or non-leveraged account or buy a derivative of the index as a whole on a leveraged account.

[Guest CocolinoFan]

@CaseynotesFinally is this specific to the IG platform. Or no matter what you can't buy "shares" of the S&P no matter what broker you have?

[Caseynotes]

@CocolinoFan, it's not specific to IG, it is just the way it works for every broker and every index in every country.

https://investorplace.com/2019/02/3-ways-to-buy-sp-500-stocks-invtlk/

[Guest CocolinoFan]

@CaseynotesOk I will give this a read. Thank you so much for takeing the time to help me out ❤️